Suppose you purchase a ten-year bond with 6% annual coupons. You hold the bond for four years, and sell it immediately after receiving the fourth coupon. The bond's yield to maturity was 5% when you purchased and sold the bond. i. What are the cash flows from your investment in the bond per £100 face value?  ії. What is the internal rate of return of your investment?

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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Need both parts with formulas not the excel. .....don't attempt if you will jot solve both parts

 

Suppose you purchase a ten-year bond with 6% annual coupons. You hold the bond for four years, and sell it immediately after receiving the fourth coupon. The bond's yield to maturity was 5% when you purchased and sold the bond.

i. What are the cash flows from your investment in the bond per £100 face value? 

ії. What is the internal rate of return of your investment

Use formula's and not excel spreadsheet please.

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